Pages

Friday, November 16, 2012

U.S. [Weekly Crude] Oil Production Increases to Highest Since December 1994

By Asjylyn Loder, Bloomberg, Nov 7, 2012
U.S. [crude -- D.R.] oil production rose to the highest in almost 18 years as a shale drilling boom cut reliance on foreign fuel and nudged the country closer to energy independence.

Output swelled by 8,000 barrels to 6.68 million barrels a day in the week ended Nov. 2, the Energy Department reported today. It was the most since [the week of -- D.R.] Dec. 23, 1994 [, when crude output topped 6.7 million b/d---please see Argus. Also, please see EIA data on weekly U.S. field production of crude oil, Jan 7, 1983 - Nov 2, 2012. -- D.R.]. Improvements in horizontal drilling and hydraulic fracturing, or fracking, have unlocked fuel trapped in deep underground rock formations in states such as North Dakota, Texas and Oklahoma. [The volume of crude flowing from US onshore and offshore wells is up more than 14 percent, or 830,000 b/d, over the same time last year, mostly due to an unconventional oil boom in several shale formations, including the Eagle Ford of south Texas, the Permian basin in west Texas and North Dakota's Bakken---please see Argus -- D.R.].

The U.S. met 83% of its energy needs in first six months of 2012, on track to be the highest annual level since 1991, according to department data compiled by Bloomberg. Production advanced 31 percent this year in North Dakota, 19 percent in Texas and 11 percent in Oklahoma, department records show. Crude imports have declined 11 percent this year.

“Every added barrel we make here is another barrel we don’t need from somewhere else,” said Kyle Cooper, director of commodities research at IAF Advisors, a Houston consulting firm.“U.S. production could reach 9 million to 10 million barrels per day in another five to 10 years.” [Read Full]

(According to EIA, U.S. crude oil production, including lease
condensate, averaged almost 6.5 million barrels per day in September 2012, i.e., 6,468,000 barrels per day -- D.R., the
highest volume in nearly 15 years. EIA maintains the last time the United States produced 6.5
million barrels per day or more of crude oil was in January 1998, sic >> my remark -- was in April 1998 when it produced 6,483,000 barrels per day -- D.R. Since
September 2011, U.S. production has increased by more than 900,000 barrels per
day. Most of that increase is due to production from oil-bearing rocks with
very low permeability through the use of horizontal drilling combined with
hydraulic fracturing. The states with the largest increases are Texas and North
Dakota. From September 2011 to September 2012, Texas production increased by
more than 500,000 barrels per day, and North Dakota production increased by
more than 250,000 barrels per day. Texas's increase in production is largely
from the Eagle
Ford formation in South Texas and the Permian Basin in
West Texas. North Dakota's increase in oil production comes from the Bakken formation
in the Williston Basin. Increased production from smaller-volume producing
states, such as Oklahoma, New Mexico, Wyoming, Colorado, and Utah, is also
contributing to the rise in domestic crude oil production---please see EIA,"U.S. Monthly Crude Oil Production Reaches Highest Level since 1998," Today in Energy, Dec 4, 2012.Wood Mackenzie Ltd. calculates oil and gas companies will spend $28 billion in the South Texas Eagle Ford play during 2013---please see OGJ, Dec 6, 2012.